Asian shares follow Wall St down after poor US data
HONG KONG (AFP) - Asian markets slumped, following a huge sell-off on Wall Street as disappointing US economic data compounded already deep fears about emerging markets.
Traders were also spooked by a warning from Treasury Secretary Jacob Lew, who said the US borrowing limit would be reached on Friday, renewing fears of a Washington stand-off and possible default.
Tokyo dived 2.62 per cent by the break, Hong Kong sank 2.15 per cent after a four-day holiday weekend, Sydney fell 1.33 per cent and Seoul was 1.41 per cent lower. Shanghai and Taipei were closed for the Chinese New Year holiday.
US stocks took a hammering on Monday after the Institute for Supply Management said its purchasing managers index (PMI) of manufacturing activity fell to 51.3 last month from 56.5 in December. A figure above 50 indicates growth and anything below points to contraction. On Wall Street, the Dow closed down 2.08 per cent, the S&P 500 fell 2.28 per cent and the Nasdaq 2.61 per cent.